US oil price remains in red on Wednesday and extend weakness towards $49.00 support (Tuesday’s low / Fibo 61.8% of $48.16/$50.27 recovery rally), following repeated rejection at $ 50.00 resistance zone.
Tuesday’s action was capped by daily Tenkan-sen at $50.00, after Monday’s short-lived spike to $50.27.
Concerns about increasing production of US shale oil were boosted by rising output from Libya, which is expected to rise to 800,000 barrels per day and threatening to further undermine OPEC’s attempts to support oil prices by extending output cut.
Near-term studies turned negative on recent pullback from recovery rejection at $50.27, as thick hourly cloud caps and continue to weigh on near-term action.
Daily studies are losing traction and see growing risk for retest of pivotal supports at $48.73 (20SMA), $48.16 (last Friday’s low) and $47.86 (daily Kijun-sen) on sustained break below $49.00 handle.
Broken 200SMA now offers strong resistance at $49.66, followed by daily Tenkan-sen at $50.00 and Monday’s high at $50.27.
Res: 49.66, 50.00, 50.27, 50.55
Sup: 49.00, 48.73, 48.44, 48.16
